Hill v. Davenport, (No. 177.)
| Decision Date | 07 March 1928 |
| Docket Number | (No. 177.) |
| Citation | 185 N.C. 271,141 S.E. 752 |
| Court | North Carolina Supreme Court |
| Parties | HILL et al. v. DAVENPORT. |
Appeal from Superior Court, Pitt County; Grady, Judge.
Action by Paul Hill and another against J. F. Davenport and wife and Nick Cartos. From the judgment, Cartos appeals. Affirmed.
Albion Dunn and Peter R. Hines, both of Greenville, for appellant.
J. C. Lanier, of Greenville, for appellees.
ADAMS, J. Mrs. Davenport, the feme defendant, owns a building in the town of Greenville, which prior to the beginning of this action had been used as a cafeteria. On July 30, 1927, she and her husband, a codefendant, executed a written instrument by the terms of which for value they sold to the plaintiffs their good will in the business and agreed neither to lease the building for use as a cafe or cafeteria, "nor to permit it to be used by themselves or others as a cafe, cafeteria, or restaurant, or for other eating purposes for a period of five years, beginning August 1, 1927." On December 27, 1927, J. F. Davenport undertook to lease the premises to Nick Cartos for a term of five years by a written agreement containing this provision:
"This lease is made to the party of the second part with the full understanding that he may engage in and carry on any kind of (legal) business he may desire to engage in with exception of cafe and cafeteria business; that is to say, that he may engage in merchandise, groceries, lunch counter, hot dogs, and any and all businesses with the specific exception of the cafe and cafeteria business."
The plaintiffs brought suit to enjoin the defendants from using the building in violation or disregard of the agreement they had made with Mrs. Davenport and her husband; and specifically alleged that Cartos had knowledge of this agreement at the time he made the purported contract with J. F. Davenport. They alleged in addition that each of the defendants is insolvent and unable to-respond in damages. A temporary restraining order was issued which was afterwards continued to the hearing for the determination of issues of fact joined upon the pleadings. The appellant excepted and appealed, and he now presents the single question whether the contract between the plaintiffs and Mrs. Davenport and her husband is unenforceable as being contrary to public policy or a combination in restraint of trade.
Chapter 53 of the Consolidated Statutes deals with monopolies and trusts. It declares to be illegal every contract, combination, or conspiracy in restraint of trade or commerce, and condemns the several acts particularly defined in section 2563; but in subsection 6 there is a provision which has immediate bearing upon the question raised by the appeal:
"Nothing herein shall be construed to prevent a person, firm or corporation from selling his or its business and good will to a competitor, and agreeing in writing not to enter the business in competition with the purchaser in a limited...
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